Posted
by
Soulskill
on Saturday July 02, 2011 @09:37AM
from the ongoing-bad-pr:-priceless dept.

An anonymous reader writes "After six months of financial blockade by Visa and MasterCard, during which they claim to have lost over $15,000,000 in donations, WikiLeaks and Datacell are filing a complaint against the two financial giants, with plans to litigate should the block not be lifted. WikiLeaks stated, 'On June 9th the law firms Bender von Haller Dragested in Denmark and Reykjavik Law Firm in Iceland acting on behalf of DataCell and WikiLeaks told the companies that if the blockade is not removed they will be litigated in Denmark and a request for prosecution will be filed with the EU Commission.'"

The fact here is:Someone in the US Government told Visa and Mastercard to get rid of this customer.Visa and Mastercard get in touch with Datacells acquirer (http://en.wikipedia.org/wiki/Acquirer) and ask if this customer really is what it says it is, and if due dilligence is done. Actually, Visa and Mastercard demands that the acquirer visit every new customer, to verify that they really are a restaurant etc (which they obviously almost never do).Datacell has told their acquirer that they accept payments for "datahosting" or something like that, but in fact their only business is collecting donations for Wikileaks. This is violation according to visa and mastercard rules. So datacell/wikileaks fucked up, easy as that. Now no other acquirer dear to accept them as a customer:)

"The economy of the European Union generates a GDP of over €12,279.033 billion (US$16,228.23 billion in 2010) according to the IMF, making it the largest economy in the world. The EU economy consists of a single market and the EU is represented as a unified entity in the WTO." (wikipedia)

With an internet service provider, either the company should be liable for absolutely everything that passes through their network, and they should be free to allow and to block whatever they wish or they can claim "common carrier" status and waive liability, however they are required to allow everyone to use their network.

In my opinion the same should apply to financial institutions. Visa and MasterCard should be allowed to block payments if they like, but if they do discriminate then they should be held liable when they do let illegal transactions get processed.

I do not often reveal virtually anything that could possibly tie me to what sector I work in but I can assure you that banks, foreign exchange brokers and payment processors such as Visa and MasterCard are regulated by government agencies which can impose huge fines for sending a payment to any person or organization on the OFAC of FINCEN lists. In some cases, these organizations can be financially ruined if they are blackballed other banks which they have peering relationships with as a result of repeated infractions of government regulations.

And the alternative is? Communism? Nice idea, but it has been shown to fail by history...

Regulated capitalism, of course -- which has been shown by history to succeed far better than the unregulated sort.

I really can't do better to summarize that history than Elizabeth Warren:

Okay, a young country, George Washington is in his first term and we have a credit freeze. There is a financial panic. Every ten to fifteen years there is a financial panic in our history. Just look at it. And there is a big collapse, trouble, people lose their farms, wiped out, until we hit the Great Depression. We come out of the Great Depression and we say we can do better than this. We don't have to go back to this type of boom and bust cycle. We come out of the Great Depression with three regulations. FDIC insurance. It is safe to put your money into banks. Glass-Steagall. Banks won't do crazy things. And some SEC regulations. We go fifty years without a financial panic, without a crisis... some recessions but no crisis, no banks failing. No big crisis. Then what happens? We say that regulation is a pain, it's expensive, we don't need it. So we start pulling the threads out of regulatory fabric. And what is the first thing that happens with that? We get the S and L crisis. Seven hundred financial institutions fail. Ten years later what do we get? Long term capital management when we learn that when one thing collapses in the world that it collapse everywhere else. In the early two thousands, we get Enron which tells us that the books are dirty. And what is our repeated response? We just keep pulling the threads out of the regulatory fabric.

Ending most recently with the Great Recession of 2008, from which we have not yet recovered. (Oh yes, there was that extraordinary rescue by the government to prop up those brilliant innovative capitalist heroes, and to keep the Wall Street bonuses flowing. But no regulatory reform to speak of.)

But Wikileaks is breaking US Law by knowingly publishing Classified Documents.

No matter how you feel about WikiLeaks, it is not illegal to publish classified documents in the U.S. There is no "state secrets" law like some other nations have. While there are laws that can punish the person who is entrusted with a classification and uses that to leak information, there are none about publishing it. This was affirmed by the Supreme Court after the publication of the Pentagon Papers. Newspapers publish classified information all the time.

You may disagree with those laws, but they exist and have full legal standing.

Not sure why you felt the need to add this rather than providing some evidence, but again, it's not true.

Most countries would probably be overjoyed.Denmark massively pushes their own payment system (paying with anything else incurs extra fees), France has its "carte bleue" and in Germany EC/Maestro vastly dominates Visa/Mastercard (even if nobody is officially pushing for it).That last one also available in basically all of Europe, though in some parts you will have a lot more issue paying directly and might have to go to an ATM instead.So it is likely enough that the main effect would be less money going to US companies (and thus the joy).